Judge warns: ‘You can’t just throw up your hands’ at ESI obligations

Posted by Gregg Mayer on Friday, February 29th, 2008   

In a slow-developing lawsuit in New York, a federal judge recently took the County of Suffolk to task for its “lack of diligence” in disclosing electronically stored information (“ESI”).

In a nutshell: the county at first said it only had two email messages to disclose; then, the county acknowledged that it had email on inaccessible back-up tapes, including several back-up tapes damaged by a water pipe burst; later, the county said the tapes could be restored at a great expense, and the water pipe burst was not so bad; finally, the county hired a vendor that restored more than 2,400 pages of email, most of which needed to be disclosed.

It is a remarkable case of e-Discovery gone awry.

How The Case Developed

The case is Toussie v. County of Suffolk. As brief background, Toussie sued the county in 2001 for a violation of his civil rights for denying him an opportunity to purchase 31 acres of property, according to The New York Times.  A second lawsuit with additional plaintiffs commenced in 2005 and was joined with the first lawsuit.

During the discovery process – a process where both sides disclose evidence to the other side – the county disclosed only two emails. Toussie complained this was insufficient – after all, what business, let alone a county, only has two emails to disclose with so much communication taking place over computers? The court agreed with Toussie.

The court ordered the county to search its servers for email. The county responded it did not have the resources to fully search the back-up tapes. Moreover, it was clear the county did not implement a litigation hold on email once the litigation was underway. This lapse drew the court’s ire at a subsequent hearing:

You can’t just throw up your hands and say we don’t store email in an accessible form and then expect everybody to walk away. The question is, how can a plan be implemented to provide for some production.

Threatened with sanctions

Pressed by the court to do something, the county estimated it would cost nearly $934,000, and take 960 man hours, to retrieve email. The county said hiring an outside consultant would cost between $617,000 and $672,000. In addition, the county said it would take approximately two-and-one-half years to restore all of the email and complete production.

After receiving the county’s estimates, the court scheduled another hearing to try to implement a less costly and time-consuming search. At this next hearing, however, the county lawyers said a water pipe had burst and destroyed some of the back-up tapes. No one had told the other lawyers or the judge of this disaster.

The court threatened a spoliation sanction for the lost email, and the county responded it would hire an outside vendor to restore the tapes that were not damaged. The cost to hire the vendor would range from $418,000 to $963,500.

Following the threatened sanctions, the county was able to restore some tapes on its own. Then, the outside vendor was asked to restore 417 back-up tapes. Of those, the vendor could not restore 9 percent – or 36 tapes. The water pipe burst, it turns out, had only damaged “one tray of tapes,” and other tapes were not recoverable for other reasons, such as formatting problems. (It is worth noting the vendor was able to restore the 400-plue tapes in under 80 days – far less time than the two-and-a-half years the county initially estimated.)

No Spoliation, But Must Pay Attorney Fees

In the end, the vendor retrieved more than 2,400 pages of email messages, of which only 200 were withheld due to attorney-client privilege issues. There were still problems with this ESI disclosure, according to Toussie, and there were still missing email messages. Toussie still wanted spoliation sanctions against the county.

The court concluded, however, that even if there were some missing email messages, that was not enough to warrant a dismissal or adverse jury instruction:

While the evidence is clear that at least 9% of the back up tapes were destroyed and the plaintiffs may be correct that e-mails have been deleted by users, there is no reason to believe that any of those e-mails would have provided any additional support of plaintiffs’ claims.

Accordingly, the plaintiffs have not sufficiently demonstrated that the destroyed/lost emails were favorable or relevant and the motion for a default judgment or an adverse inference instruction is denied.

The county was ordered to pay Toussie’s attorney fees for the e-Discovery debacle.

For another discussion of this case, and to read the court opinion, see the e-Discovery Team blog.

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